Wednesday, February 09, 2005

Geoff Pullum observes, in passing, that “the notion of small textbooks has just vanished in modern America (800 pages is commonplace, 400 is positively wimpy, and under 200 is close to unknown).” Why? I figure it’s for the same reason textbooks are so expensive: there’s a third-party buyer problem. Professors do the choosing, while students do the buying. Thus, professors have little incentive to choose inexpensive textbooks.

But why the displacement of small, narrow-focus texts by massive, encyclopedic ones? A textbook that covers all the topics a professor intends to cover provides one-stop shopping, so the professor doesn’t have to order multiple texts. But not all professors of a given subject want to cover the same topics. For instance, I teach intermediate microeconomics. I like to cover the theory of risk and uncertainty, theories of (alleged) market failure, and game theory. But another professor might consider those topics less important, and spend more time on (say) labor markets, a topic I skimp on. A smaller textbook covering fewer topics would likely appeal to just one of us, while a comprehensive text will get business from both. As a side effect, all students end up buying a microeconomics text with numerous chapters that go unused.

Here’s the economic puzzle: Why has this phenomenon only appeared in recent decades? Professors have always chosen the texts that students have to buy. So why haven’t textbooks always been huge and expensive? What’s changed?

More economics has been invented (and thus needs to be covered), so textbooks get larger to cover this additional material?

Maybe compare modern textbooks to those of a few decades ago and see what it is that modern textbooks are including that wasn't included before. If it's mostly new theories/empirical findings, well, there's your answer.

One of my older professors loved to tell us how hard our jobs were as students compared to when he was in college because not only did we have to learn everything he had to learn, but we had to learn all the new stuff that had been invented since he was in school -- but all in the same number of classes.

Glen, as you concede, economic efficiency and profit maximization will always pressure textbooks in the direction of hyper-comprehensiveness. The question of "why not before?," I think, can be addressed with technology advances and market forces. Obviously, once any particular text has gained a foothold and share of the market, it becomes much easier to market incremental improvements vs. selling in something new. Likewise, it becomes an easier and less time consuming decision for the professor to go with a new and improved version of something that's established and/or familiar. Possible hypotheses regarding "why now?":

1. Modern publishing technology allows leagues of writers to more seamlessly and quickly build on a particular text vs. having the original authors perpetually occupying their time tinkering with it. This has the added benefit of allowing more frequent edition changes that both obsolete previous versions, reducing losses to the resale market, and providing better marketing opportunities. "New and imporoved" is easier to market than "same as last year."2. Authors with expertise in particular subject areas are more likely to be hired by publishers to enhance market leading texts. Because of the established market leadership positions of existing texts, the guaranteed financial rewards likely outweigh the risk adjusted rewards inherent in producing original work intended to compete with big publishing.3. Publishing companies are producing truley mass-appeal textbooks because they are applying recently developed tools in the fields of market research and consumer knowledge. Only in the last few decades (since the widespread use of computers) have big companies been able to truly develop and apply the kind of mathematically based market knowledge models that let them optimize scores of variables to achieve the best results - in this case, those results are textbooks with evolving content that strengthen the loyalty of its current base while bringing new consumers into the franchise away from competition. With these tools largely undeveloped at or unavailable to smaller publishers, the big textbooks from the big publishers will continue to grow in size until it is no longer economically optimal to do so.

Another factor is that typesetting is much cheaper than it used to be, relative to other costs of textbook creation, production and distribution. As a result, the forces that lead naturally to larger texts (mostly, I think, the desire to maximize the market by including material relevant to a larger number of course designs) are not as strongly held in check by the additional production costs of larger books.

This third-party buyer problem is compounded by the fact that often enough the professors themselves are contributors on the textbook and so receive a share of royalties. Supposedly, not much, but still something. And also, the principle of Keep It Simple Stupid, really hasn't taken off in Academia, where the operative principle seems to be...Show off how many words you can write down.